Cash House Buyers

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Buying a home is a huge investment and can take a long time especially when following the conventional route of finding a listed home, negotiating with agents and then making an offer to purchase only to be kept in limbo waiting for a response or a counter-offer.

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Cash buyers, however, can avoid some of these steps making the process a lot easier for all parties. Paying cash for a property has a number of advantages over financed options for both parties. There are plenty of cash buyers, both foreigners and locals, especially in an area like Las Vegas who are looking for an investment opportunity in the city and they are a lot easier to work with than real estate agents. I know this because I worked with cash house buyers and they bought my residence in vegas for cash.

Why cash sale?

With cash sales, there is no need for appraisals as you work directly with the buyer and not the financers. This makes it less likely for your purchase price to be affected by the appraisal and may mean better margins for you as a seller. Additionally, since they do not need external financing, there is no risk of the sale falling through if their loan is not approved or the house fails the inspections ordered by the bank. These processes usually delay the sale and can result in the sale falling through altogether. It also makes closing faster as there is no waiting period for the loan approval and the sale can go through as soon as all parties are satisfied with the conditions set forth. Closing costs are therefore lowered for both the buyer and seller as there are no additional fees for mortgage brokers or bank attorneys and the buyer does not have to wait longer which costs him money.

Not affected by the market

cdrthsesMarket fluctuations are also highly unlikely to affect the sale because of the short period. Market fluctuations also affect other charges such as appraisal rates which can get your property valued lower than expected if the market dips. Cash buyers generally make the process easier and cut down the time spent haggling with banks and agents and eliminates all other middlemen that can make it slower to close on a property. This is the benefit you get as a seller when you work with cash buyers. For the buyer, you get to reduce various charges that would otherwise drive the purchase price even higher.

Features of a Bridging Loan

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A bridging loan refers to a short-term finance facility that you secure to fund or repay a purchase of property. It implies that the loan procured bridges the gap that exists between the time of new purchase and the period it will take you to sell your property. It helps you settle the current transaction as you wait for the finalization of your pending sale, which once it happens, you will use the proceeds to refinance the bridging loan.

This form of financing has helped property owners and developers in the interim to secure new home or complete an ongoing process as they wait for the sale of their home to materialize.

Some of the features of a bridging finance include the following:

Features

Duration

A bridging loan is a short-term financing meant to span a transaction on property development or purchase. The kjkjkjkjyyplength of time it exists depends on the time it will take to finalize the pending sale of property.

The shorter the time a bridging finance exists, the better, because it will mean less accumulation of interest.

Interest rate

Since bridging loan only last for a short period, lending institutions do charge a high rate of interest on this credit facility. Moreover, some lending institutions such as solicitors do include the additional cost of between three and five percent to the set interest rate, making it more expensive obtaining the loan from them. All the cost of a bridging loan is calculated based on interest rate alone.

Application process

The short-term nature of this credit facility makes the process of securing it a rigorous and involving one. The lending institutions consider the income of the applicant as well as several variables to determine whether to release the credit. Therefore, you need to supply detailed information as per the guidelines in addition to providing an accurate calculation of the figures. Its application process has seen many property owners failing to succeed because most of them do not give all the information required.

Risk

mnbvxzwqBridging financing is associated with high risk, which informs the reason why banks request more information to ascertain the feasibility and viability of extending it to the applicants. It is because the refinancing of a bridging loan depends on the finalization of the sale of another property.

Consequently, the bank offering this credit facility takes over the secured loan on your present house and that of the new house. The security of the entire amount of financing is on these two properties. Often the bridging loan includes the new property’s purchase price, stamp duty, legal fees, lenders fees, and the loan balance on the current property.